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Insights from the Manchester CFO & Audit Chair roundtable

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The role of the Chief Financial Officer (CFO) has evolved significantly in recent years, reflecting broader changes in business environments, technology and organisational priorities. To explore this further and to understand the business priorities and challenges on the agenda of CFOs right now, Simon Moore, Managing Director, Amy Luke, Senior Director, Matthew Stent, Director and Victoria Ward, Director, from BIE’s CFO & Financial Leadership Team hosted a CFO & Audit Chair roundtable for BIE’s North West network of CFOs at Kings Street Town House, Manchester, on 27th September 2023.

Peter Morton, CFO of Rolls Royce SMR, headquartered in Manchester, initiated the discussion by describing how Rolls Royce Small Modular Reactors is supporting local communities and the region by providing clean and sustainable energy. 

The discussion that followed focussed on topics that are pertinent to the CFO community right now, including margins, revenue, profit and cash – the KPIs that matter. It was universally acknowledged that while leaders must manage costs, staffing and time management effectively, they are also grabbling with a new set of challenges that transcend all industries, comprising of following:

1. Returning to the office

One unanimous challenge on the CFO agenda, almost four years after the first covid lockdown, is the issue of returning to the office. The consensus is that there is no one-size-fits-all solution.  A common theme is the generational resistance to returning to the office, which is impacting training, learning by osmosis and ultimately, staff retention.

Some insightful and interesting solutions were shared, including the introduction of staff share schemes to all employees to foster a sense of belonging and shared responsibility for the company’s growth. These initiatives had been generally well received when the benefits were effectively communicated.

2. Staff retention and culture during hyper growth

Bucking the trend of the prevailing economic climate, many CFOs around the table are steering their companies through a phase of hyper growth, which in turn is bringing challenges around staff retention, unsuccessful hires and maintaining culture and core values as the businesses evolve and expand at pace.

3. ESG & decarbonisation

Interestingly, ESG and decarbonising were mentioned by a few CFOs as high priority business challenges, but they weren’t high on the priority list for others, who are navigating increasingly trickier times in their businesses – seemingly, the appetite for driving that change is linked to government policy, which has recently taken a different course.

4. Finance transformation

Finance transformation is a critical aspect of the modern CFOs responsibilities, especially in the face of evolving business challenges. It involves reimagining and redesigning financial processes, systems, and functions to improve efficiency and value delivery, and formed a central pillar in the evening’s conversation.

Managing people during times of transformation and uncertainty proved to be a universal challenge. Nevertheless, it was also viewed as an opportunity for growth and positive change when executed correctly. Clear communication, setting a clear vision, empowering and involving the team, and providing support and resources were seen as the most critical factors when driving change. Celebrating the small victories, managing resistance constructively and monitoring progress were also seen as ancillary needs. 

5. The role of AI

AI emerged as a prominent topic, with a particular focus on examples of successful deployment and how this had been achieved. There were several instances where it has been implemented with demonstrable benefit at scale.

6. Regulatory compliance and reporting

Staying abreast of evolving regulatory requirements and ensuring compliance with financial reporting standards, tax laws and other industry-specific regulations were also on the agendas of several CFOs.

Conclusion

Senior finance leaders continue to see people as the beating heart of their business, even as they confront varying degrees of challenge associated with the workforce, such as retention in competitive markets, maintaining culture and core values during periods of growth, and striking the right balance in terms of hybrid working and L&D opportunities.

AI remains a constant topic of interest, but the jury is still out on how to best utilise the tools that are available and how to integrate them properly to drive the right level of automation. Transformation projects and continuous change programmes remain at the forefront of the C suite community’s agenda, with board and investors wanting to see increased efficiencies across people, processes and systems. However, challenges including budget constraint, resource allocation, clearly defined project roadmaps and access to the right level of expertise continue to be hurdles faced by CFOs and business leaders.

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